The use of nominee structures has become an increasingly important legal issue in Thailand, particularly in relation to foreign investment, restricted businesses and land ownership. In recent years, especially in 2026, Thai authorities have increased their scrutiny of arrangements in which Thai individuals or Thai companies appear to hold shares or assets in their own names, while the real investor, controller or beneficiary is a foreigner.
While certain regulations in Thailand regarding foreign investment, particularly the Foreign Business Act (FBA) which has not undergone significant changes in 27 years, may become outdated within the context of competition within ASEAN members, the use of AI and data sharing between different Thai ministries makes it unlikely that foreign investors will be able to maintain nominee structures in 2026. Our law firm, Herrera and Partners H&P has prepared a brief preliminary summary of nominee cases from the perspective of our dispute resolution and litigation team in Bangkok
In general terms, a “nominee” refers to a Thai individual or Thai juristic person who holds shares, property or other rights in their own name for the benefit of another person, commonly a foreigner, while the foreigner remains the person who actually provides the funds, controls the investment or receives the economic benefit.
The purpose of such an arrangement is generally to make the investment appear to comply with Thai ownership requirements while allowing the foreign investor to exercise control or benefit from the business or property. However, not every Thai shareholder in a company with foreign shareholders is automatically a nominee. The legal issue is whether the Thai shareholder genuinely owns and controls the investment or is merely holding it on behalf of the foreigner to circumvent restrictions imposed by Thai law.
The most common nominee structures arise in connection with businesses restricted to foreigners under the Foreign Business Act B.E. 2542 (1999) and with land ownership. Under the Foreign Business Act, a large number of companies, especially in the service sector, are subject to restrictions on foreign participation, as the 1999 regulations, which are still in force, state 27 years later that nothing has evolved and that “Thai citizens are still not ready to compete with foreigners.”
A nominee arrangement may therefore be used to create the appearance that a company is Thai-owned even though the foreigner is, in substance, the person controlling or benefiting from the business.
Section 36 of the Foreign Business Act expressly prohibits a Thai national or Thai juristic person from assisting or supporting a foreigner in operating a restricted business, including by acting as a nominee in holding shares for the foreigner. A foreigner who allows such an arrangement to be established may also be subject to liability.
The issue becomes particularly sensitive when a nominee structure is used to acquire or hold land in Thailand. As a general principle, foreigners are restricted from owning land in Thailand, subject to limited statutory exceptions.
The Land Code therefore contains specific provisions designed to prevent foreigners from circumventing these restrictions by using Thai individuals or Thai juristic persons as representatives or nominees.
Section 96 of the Land Code provides that where a person appears to acquire land as the owner but is in fact acting on behalf of a foreigner or a foreign juristic person, the authorities may require the land to be disposed of.
Other criminal laws may also become relevant depending on how the nominee arrangement was established and the documents or statements used in the transaction. For example, if false information or false documents are submitted to government officials in order to register a company, acquire land or conceal the true nature of the transaction, offences under the Criminal Code relating to false statements or false documents may potentially arise.
Nominee arrangements may also create additional legal risks where the underlying funds or assets originate from criminal activities. If money obtained from fraud, corruption, drug trafficking, or another predicate offence is transferred through nominees or used to acquire shares, land or other assets in order to conceal its origin or beneficial ownership, the conduct may potentially raise issues under the Anti-Money Laundering Act B.E. 2542 (1999). In such circumstances, the nominee structure may become part of a broader investigation into the source and movement of criminal proceeds.
The current enforcement environment demonstrates that nominee cases are no longer viewed merely as a corporate registration issue. Thai authorities are increasingly examining the substance of ownership and control, including the source of investment funds, the financial capacity of Thai shareholders, the actual management of the business, the flow of profits, and the relationship between Thai shareholders and foreign investors.
If you need a legal consultation with our Bangkok litigation attorneys and corporate lawyers in Thailand about nominee cases, please contact H&P at info@herrera-partners.com
